The effectiveness of ads is highly doubtful in general - especially when you're looking at impressions rather than clicks. And that's before we consider advertising mostly being mostly a zero-sum game.

Advertisers are willing to pay more for privacy-invading ads because they believe they are more effective. If privacy-invading ads were illegal they'd just go back to context-dependent ads like they have been using for the thousands of years before the internet was invented, and after an adjustment period the revenue will just bounce back to where it was before.

Most advertisers know this already. If privacy-invading ads were so effective, why are all the major brands now using influencers to market their products? Why go through the effort of finding a specific Instagram channel which might be a good fit and convincing the operator to enter a brand deal, when you could also just directly pay Instagram for a highly-targeted ad one swipe away?

> Effective ads absolutely require knowing more about the user than the context on the page

That's what the tracking industry keeps telling you with zero evidence it's true.

And then there are studies like this one: https://www.sciencedirect.com/science/article/pii/S016781162 which say that targeted ads need to be 100% to 700% more effective to be as profitable as non-targeted ads

As I understand it, it is the position of several DPAs that denial of access entirely (i.e. "consent or pay") could contravene the "freely given" requirement of GDPR in most cases, though this has thus far not been tested in court.

(see e.g. https://iapp.org/news/a/cjeu-clarifies-cookie-consent-requir... https://www.edpb.europa.eu/news/edpb-consent-or-pay-models-s... )

> but companies could start offering content in return for those things instead of ads.

Again, that is not a requirement. If your argument is that they give us content for free because of ads, ads don't require pervasive and invasive tracking. Or hiding stuff behind paywalls (since ads pay for it).